 "Card devaluation: How to pick between Axis Bank Magnus and HDFC Regalia Gold")
While most credit cards come with features inclined towards one or more categories, some credit cards in the market offer benefits to the users, spanning across shopping, travel, entertainment, dining and other important spending categories. . Two popular credit cards among high spenders are the HDFC Regalia Gold and the Axis Magnus credit card, both of which have been devalued in the recent past as banks scale back on lucrative perks.
Last week, HDFC Bank announced changes to its lounge access programme for the popular Regalia credit cardholders in India, effective from December 1. Users will need to meet a spending criterion of Rs 1 lakh or more per quarter in a calendar year to access lounge facilities. Similarly, Axis Bank revised the terms of its Magnus Credit Card, by not only removing the monthly milestone benefit but also raising the annual fee. Starting September 1, the bank devalued the rewards associated with the card, along with the exclusion of specific payment categories from earning reward points. In addition to losing its 25,000 points monthly milestone benefit, the annual fee increased from Rs 10,000 + GST to Rs 12,500 + GST.
"Credit card issuers often revise the features, reward structure, welcome/milestone benefits, fees and other terms and conditions on their credit cards. This is usually done to keep up with the changing market trends, consumer demands and competition. While some of the changes might be minor, others can largely impact card users and their reliability on a particular credit card," said Rohit Chhibbar, Head of Credit Cards Business, Paisabazaar.
Here is a compilation of credit cards by Paisabazaar that have been devalued in the recent past
Here is a compilation of credit cards by Paisabazaar that have been devalued in the recent past
Regalia vs Regalia Gold
Despite these changes, when it comes to owning a lifestyle credit card, the HDFC Regalia credit card still offers a host of benefits on travel, shopping, dining, etc. Recently, the HDFC Bank launched a new offering to its Regalia cards, the Regalia Gold credit card. Like the Regalia, the Regalia Gold has an annual fee of Rs 2500 along with several lifestyle and travel benefits. For example, Regalia Gold card offers a complimentary Club Vistara Silver Tier and an MMT Black Elite membership on spending Rs 1 Lakh or more within 90 days of card issuance.
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The reward rate on both the cards are the same, but the Regalia Gold has partner brands Myntra, Nykaa, Reliance Digital, etc. on which you get 5x reward points.
The Regalia Gold has better milestone benefits and even offers complimentary flight vouchers on achieving the target spend amount. The milestone benefits offer an extra return of 2.1% on the Regalia Gold at a lesser spend of Rs 7.5 Lakh in a membership year. Regalia’s milestone add up to a bonus return of just 0.94% on spends. So, if you are a high spender then Regalia Gold is a better choice.
Regalia Gold credit cards offer 12 complimentary domestic and 6 complimentary international lounge access to cardholders. Starting from 1 December 2023, HDFC Bank Regalia Credit Cardholders will be eligible for 8 complimentary domestic and 6 international lounge accesses each on quarterly spending of Rs 1 lakh.
The Regalia card offers bonus 10,000 reward points on spending Rs 5 lakh in the anniversary year. You get an additional 5000 reward points on spends of Rs 8 lakhs or above in the previous year. The Regalia Gold Credit Card offers Rs. 1500 worth of gift vouchers from Marriott, Myntra, M&S, and Reliance Digital on spending Rs 1.5 lakh or more every calendar quarter. You also get Rs 5,000 worth of flight vouchers when you spend Rs 5 lakh in a card anniversary year.
Moreover, Regalia Gold credit card gives you access to the Exclusive Gold Catalog where you can redeem your points for Apple, Samsung and other products at 0.65 Re/pt, which the Regalia card does not offer. Regalia Gold also gives you access to new mile transfer partners like Aeroplan and LifeMiles, which Regalia does not.
But how does Regalia Gold compare with the Axis Magnus?
HDFC Regalia Gold and Axis Magnus are credit cards from two different leagues. While HDFC Regalia Gold would be available to a larger set of consumers with a minimum monthly income requirement of Rs.1 lakh,, Axis Magnus requires a minimum annual income of Rs 24 Lakh, catering to high-income individuals.
Consumers who are eligible for both the cards must assess their spending habits, preferences and their inclination towards premium privileges, to make the right choice between the two.
"HDFC Regalia Gold can be a suitable option for moderate spenders who can manage spending up to Rs. 7.5 lakh in a year, as they would be able to maximize its milestone benefit as well as avail fee waiver. The card offers additional benefits on brands like Marks & Spencer, Myntra, Reliance Digital, and Nykaa, covering major lifestyle spend categories. Magnus, on the other hand, comes with extensive benefits across multiple categories like shopping, travel, movies, dining, health & wellness, etc. along with some premium features like unlimited international and domestic lounge visits, VIP assistance at airports, etc. Magnus also holds great value for high spenders who can spend around Rs. 2 Lakh a month to make the most of its benefits," explained Rohit Chhibbar, Head of Credit Cards Business, Paisabazaar.
The difference between the annual fees of HDFC Regalia Gold (Rs. 2500) and Axis Magnus (Rs. 12,500) is also huge, making it an important consideration for consumers while making a choice.
What should users do?
What should users do?
As a cardholder, you should stay informed and prepared for such a devaluation.
"When a credit card is devalued, you must re-assess if the updated features align well with your spending patterns. If not, you may look at alternative credit cards that would provide better value. However, while evaluating other credit cards, it is important to ensure that the other card fits your spending patterns better and would provide a significantly higher value than the devalued card," said Chhibbar.
For instance, the devaluation on Axis Magnus could be a concern for those who opted for the card to save a substantial amount on their travel spends as Axis Bank discontinued the monthly milestone benefit and reduced the points-to-miles redemption ratio from 5:4 to 5:2.
"If the revised travel benefits on Axis Magnus make it difficult for you to maximize its value, you can consider other premium cards like HDFC Diners Club Black or Axis Atlas Credit Card, that offer 1:1 redemption on airlines along with added benefits like international lounge access, airport meet and greet service, etc. HDFC Infinia also offers 1:1 redemption value along with premium travel benefits like complimentary hotel stay, low forex markup, etc. However, it is an invite-only card and not everyone would qualify for it," explained Chibbar.
Axis Magnus can still be considered a good ‘all-round premium credit card’, giving considerable savings across multiple categories like health, dining, movies, travel, rewards, etc. So, high-spenders looking for a premium card with multi-faceted benefits could continue using it.